Ransom Insurance For A More Dangerous World

As U.S. companies expand their business to developing countries in Latin America and the former Soviet bloc, traveling executives have more to worry about than language differences and currency translation. Unfortunately, kidnappings and extortion are on the rise in some of these places.

A small group of insurers, namely Chubb, AIG, and Lloyd's of London, have long offered policies to entrepreneurs and executives that cover ransom demands from kidnappers, both in the U.S. and abroad. But now, insurers have begun to broaden the coverage to include such extras as legal and psychiatric fees and compensation for loss of trade secrets and product tampering. Some of the new policies also reimburse expenses needed to evacuate a country rocked by political instability. Insurance companies are even offering to train executives on how to avoid being kidnapped.